BILL NUMBER: SB 497	CHAPTERED  09/07/99

	CHAPTER   362
	FILED WITH SECRETARY OF STATE   SEPTEMBER 7, 1999
	APPROVED BY GOVERNOR   SEPTEMBER 7, 1999
	PASSED THE SENATE   AUGUST 24, 1999
	PASSED THE ASSEMBLY   JULY 15, 1999
	AMENDED IN ASSEMBLY   JUNE 29, 1999
	AMENDED IN ASSEMBLY   JUNE 17, 1999
	AMENDED IN SENATE   MAY 28, 1999
	AMENDED IN SENATE   MARCH 23, 1999

INTRODUCED BY   Senator Rainey
   (Coauthor:  Assembly Members House and Lowenthal)

                        FEBRUARY 18, 1999

   An act to amend Section 33080.2 of, and to add Section 33080.8 to,
the Health and Safety Code, relating to redevelopment.


	LEGISLATIVE COUNSEL'S DIGEST


   SB 497, Rainey.  Redevelopment law:  major violations:  actions.
   The Community Redevelopment Law requires a redevelopment agency to
file with the Controller and present to its legislative body an
annual report within 6 months of the end of the agency's fiscal year
containing an independent financial audit that includes an opinion of
the agency's compliance with laws, regulations, and administrative
requirements governing the activities of the agency, and subjects
officers of the agency to specified monetary forfeitures for failure
to comply.  The Controller is required to compile and annually
publish reports of the financial transactions of each community
redevelopment agency.  Existing law provides for the filing of a writ
of mandate to compel the performance of a duty by a public entity.
   This bill would require the agency to inform the legislative body
of any major violations, as defined, of the Community Redevelopment
Law based on the independent financial audit, and would require the
Controller to compile, on or before April 1 of each year, a list of
the agencies that appear to have major violations.  The bill would
also require the Controller to determine, on or before June 1 of each
year, whether the agency has corrected the major violation.  If the
Controller determines that agencies have not corrected major
violations, the bill would require the Controller to send a list of
those agencies and their major violations to the Attorney General for
action pursuant to the bill.  The bill would require the Attorney
General to determine whether to file an action to compel compliance
with these provisions.  The bill would require the court to conduct
specified hearings and if it finds good cause to believe there is any
uncorrected major violation, to order the agency to comply within a
specified period and to prohibit, by order, specified actions by the
agency until the court determines that the violation is corrected, at
which time the court may dissolve the order.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:


  SECTION 1.  Section 33080.2 of the Health and Safety Code is
amended to read:
   33080.2.  (a) When the agency presents the annual report to the
legislative body pursuant to Section 33080.1, the agency shall inform
the legislative body of any major violations of this part based on
the independent financial audit report.  The agency shall inform the
legislative body that the failure to correct a major violation of
this part may result in the filing of an action by the Attorney
General pursuant to Section 33080.8.
   (b) The legislative body shall review the report and take any
action which it deems appropriate on the report submitted pursuant to
Section 33080.1 no later than the first meeting of the legislative
body occurring more than 21 days from the receipt of the report.
  SEC. 2.  Section 33080.8 is added to the Health and Safety Code, to
read:
   33080.8.  (a) On or before April 1 of each year, the Controller
shall compile a list of agencies that appear to have major violations
of this part, based on the independent financial audit reports filed
with the Controller pursuant to Section 33080.
   (b) On or before June 1 of each year, for each major violation of
each agency identified pursuant to subdivision (a), the Controller
shall determine if the agency has corrected the major violation.
Before making this determination, the Controller shall consult with
each affected agency.  In making this determination, the Controller
may request and shall receive the prompt assistance of public
officials and public agencies, including, but not limited to, the
affected agencies, counties, and cities.  If the Controller
determines that an agency has not corrected the major violation, the
Controller shall send a list of those agencies and their major
violations to the Attorney General for action pursuant to this
section.
   (c) For each agency that the Controller refers to the Attorney
General pursuant to subdivision (b), the Controller shall notify the
agency and the legislative body that the agency was on the list sent
to the Attorney General.  The Controller's notice shall inform the
agency and the legislative body of the duties imposed by Section
33080.2.
   (d) Within 45 days of receiving the list of agencies and major
violations pursuant to subdivision (c), the Attorney General shall
determine whether to file an action to compel the agency's compliance
with this part.  The time limit for the Attorney General to make
this determination is directory and not mandatory.  Any action shall
be accompanied by an affidavit or affidavits setting forth facts that
demonstrate a likelihood of success on the merits of the claim that
the agency has a major violation of this part.  The affidavit shall
also certify that the agency and the legislative body were informed
not less than 10 days prior to the date on which the action was
filed.
   (e) (1) On the earliest day that the business of the court will
permit, but not later than 15 days after the filing of an action
pursuant to this section, the court shall conduct a hearing to
determine if good cause exists for believing that the agency has a
major violation of this part and has not corrected that violation.
   (2) If the court determines that no major violation exists or that
the agency had a major violation but corrected the major violation,
the court shall dismiss the action.
   (3) If the court determines that there is good cause for believing
that the agency has a major violation of this part and has not
corrected that major violation, the court shall immediately issue an
order that prohibits the agency from doing any of the following:
   (A) Encumbering any funds or expending any money derived from any
source except to pay the obligations designated in subparagraphs (A)
to (G), inclusive, of paragraph (1) of subdivision (e) of Section
33334.12.
   (B) Adopting a redevelopment plan.
   (C) Amending a redevelopment plan except to correct the major
violation that is the subject of the action.
   (D) Issuing, selling, offering for sale, or delivering any bonds
or any other evidence of indebtedness.
   (E) Incurring any indebtedness.
   (f) In a case that is subject to paragraph (3) of subdivision (e),
the court shall also set a hearing on the matter within 30 days.
   (g) If, on the basis of that subsequent hearing, the court
determines that the agency has a major violation and has not
corrected that violation, the court shall order the agency to comply
with this part within 30 days.  The order issued by the court
pursuant to paragraph (3) of subdivision (e) shall continue in effect
until the court determines that the agency has corrected the major
violation.  If the court determines that the agency has corrected the
major violation, the court may dissolve its order issued pursuant to
paragraph (3) of subdivision (e) at any time.
   (h) An action filed pursuant to this section to compel an agency
to comply with this part is in addition to any other remedy, and is
not an exclusive means to compel compliance.
   (i) As used in this section, "major violation" means that, for the
fiscal year in question, an agency did not:
   (1) File an independent financial audit report that substantially
conforms with the requirements of subdivision (a) of Section 33080.1.

   (2) File a fiscal statement that includes substantially all of the
information required by Section 33080.5.
   (3) Establish time limits, as required by Section 33333.6.
   (4) Establish a Low and Moderate Income Housing Fund, as required
by subdivision (a) of Section 33334.3.
   (5) Accrue interest earned by the Low and Moderate Income Housing
Fund to that fund, as required by subdivision (b) of Section 33334.3.

   (6) Initiate development of housing on real property acquired
using moneys from the Low and Moderate Income Housing Fund or sell
the property, as required by Section 33334.16.
   (7) Adopt an implementation plan, as required by Section 33490.
